Lower oil prices to decimate EV sales
Tumbling oil prices and a wait-and-see approach will lead to a 43% sales drop in electric vehicles, <a href="https://www.woodmac.com/press-releases/global-electric-vehicle-sales-to-drop-43-in-2020/">according to a study by Wood Mackenzie</a>.
The consultancy writes that the coronavirus outbreak, potential delays to fleet purchasing due to lower oil price and a wait-and-see approach to buying new models have all contributed to this decrease in projected sales.
Overall auto sales are down, but EVs are taking a hard hit during the COVID-19 restrictions.
“At the end of January, sales of all cars in China were down by 21% compared to 2019. By February, they had plunged by 80%. EV sales were hit harder, with January numbers down 54% and February projected to be down more than 90%. EVs have constituted approximately 5% of all vehicles sales in China for the past two years.
“Most new EV buyers are still first-time owners of the technology. The uncertainty and fear created by the outbreak has made consumers less inclined to adopt a new technology.
“The first lockdown in the US did not start until 20th March but the effects have already begun to show in EV sales. General Motors is offering a discount of US$10,000 for its Chevrolet Bolt. Further such rebates are sure to follow to move inventory as demand drops further,” said Ram Chandrasekaran, Wood Mackenzie Principal Analyst.
Wood Mackenzie is hopeful for EVs in the long term. It believes that once the epidemic is contained in China, "...consumers will flock back to car dealers and reaffirm their confidence in EVs."